Education Minister Chris Hipkins told Newshub the unpaid loans are concerning, but the threat of arrest might be preventing people from returning to New Zealand, where enforcement is easier.

"I think arrest at the border sometimes exacerbates the situation, because it means those people never come home. Sometimes you're better to get them home then into an arrangement where they can start making payments."

But he said the Government was not proposing any immediate change - any changes would be "longer term".

Paula Bennett told The AM Show on Tuesday morning all student loan debtors need to do to avoid arrest at the border is get in touch with IRD and make arrangements to start repayments.

"The Labour Government have said they are looking at dropping that and not actually collecting from people at the border or addressing them there, and that's wrong," Ms Bennett said.

"We absolutely need to be tougher. They owe this money. All we are asking is they make repayments. There are other people - literally thousands of them - that are paying back their student loans, and these guys are reaping the rewards of the fabulous New Zealand education and they owe us money, and they should pay it."

You can watch Ms Bennett on The AM Show in the video at the top of this article.